10:21 24 Jun 2024

EU creates plan to bypass Hungary's veto on arms purchase for Ukraine using Russian asset profits — Borrell

Josep Borrell. Photo: Kristin Olsson/TT News Agency via Reuters

The European Union has devised a legal workaround to bypass Hungary's veto on arms purchases for Ukraine using profits from frozen Russian assets this year.

The head of EU diplomacy, Josep Borrell, stated this, according to the Financial Times.

He noted that since Hungary abstained from the previous agreement on the allocation of revenues from Russia's frozen assets, it "should not be part of the decision on the use of this money."

Borrell added that:

"This workaround is complicated, like any legal solution, but it works."

Bypassing Budapest could also remove a hurdle that could complicate G7 efforts to secure a $50 billion loan for Kyiv by December that must be repaid from future revenues, a decision leaders made at a summit in Italy earlier this month.

Almost 200 billion euros are tied up in the EU, mostly in Belgium, and the bloc agreed earlier this year to use the profits made in February to buy arms for Ukraine.

Hungary has long been opposed to the EU collectively providing military support to Ukraine. Budapest is also blocking seven other decisions related to the armament of Kyiv, worth about 6.6 billion euros.

The EU foreign ministers will discuss the legal workaround on Monday, June 24.

Concerns by the US and other G7 partners that Hungary could block the EU's decision to freeze Russian assets indefinitely have caused significant delays in negotiations over the $50 bln loan.

According to officials familiar with the matter, a legal workaround for the use of EU funds is likely to be sufficient to guarantee repayment of the loan.

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It should be noted that Hungary and Ukraine have had almost no high-level contacts since the full-scale invasion of Russia in February 2022. However, there have been some lower-level interactions.

Earlier, Zelensky said that during a short meeting in Argentina, he asked Orban to name at least one reason why Ukraine should not be in the EU.

Moreover, the Hungarian leader also stated that he has 75 more opportunities to block Ukraine's accession process, as each stage requires the unanimous approval of EU members.

It is worth noting that the EU approved the allocation of 10 billion euros to Hungary. However, any further allocation of funds will likely be met with stiff resistance. The other €20 billion, which belongs to Hungary, is held under a separate procedure that gives Brussels the leverage it needs.

Hungary is also delaying the adoption of legislation allowing Ukraine to receive up to 2 billion euros from the European Union for armaments using profits from frozen Russian assets.

However, Hungary participated in the peace summit in Switzerland on June 15-16. The country was represented at the event at the level of the Minister of Foreign Affairs.

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